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Home-equity investor Splitero has stopped taking applications from homeowners, notifying potential applicants on its website that its “primary focus is on funding homeowners who have already completed an application.”

The San Diego-based fintech, which claimed to have access to more than $1 billion in funding when it launched last year, is inviting prospects to join a waitlist, saying it will accept new applications for equity investments after it’s caught up with the “overwhelming demand” for its product.

Splitero separately announced Tuesday that it was launching a new real estate brokerage, Splitero Homes, to help homeowners in California, Colorado, Oregon and Washington “sell for the highest price.”

Splitero co-founder and CEO Michael Gifford confirmed to Inman that Splitero Funding has stopped taking applications for equity investments. He declined to say exactly when or why Splitero stopped taking applications, or when it might resume.

Detail from Splitero website’s “Frequently asked questions” page.

“Due to overwhelming demand and limited capacity, we’re currently unable to accept new applications,” Gifford said in a statement similar to the one posted on the company’s website. “We experienced an influx of applications when we launched and are focusing on helping as many homeowners in our pipeline as we can until we can start accepting new applications again. We currently don’t have a timeline, but are working diligently to remedy this situation! We encourage homeowners to sign up for our waitlist by filling out the pre-qualification form on our website, and we’ll reach out as soon as we can start accepting applications.”

Gifford had previously answered Inman’s questions about the launch of the company’s real estate brokerage, Splitero Homes, in a phone interview before Inman was aware that Splitero Funding was no longer accepting new applications.

While mortgage lenders often employ agent networks or enter into joint ventures with real estate brokerages to boost their business with homebuyers, Gifford told Inman that Splitero Homes will focus primarily on sellers of homes that Splitero Funding has already taken an investment in.

California-based Splitero offers homeowners up-front cash payments of up to $500,000, with no monthly repayments, in exchange for an agreed upon slice of a home’s future appreciation when it sells. Splitero also deducts origination fees and closing costs from the homeowner’s initial proceeds.

“We’re concentrating on homeowners that we’re already working with at Splitero,” Gifford said of Splitero Homes’ prospective clients. “So we’ve made a home equity investment — we’re not out there trying to find additional listings or bring on new buyers.”

Gifford said Splitero already has a “core team” to handle real estate sales, and plans to add agents as the offering grows.

“We’re experts in the sale game, so we can list on the MLS, sell off-market, on-market — however the homeowner wants to sell their property, that’s not a problem,” Gifford said. “We can also work with local agents in markets if we don’t have anybody there.”

Splitero launched its home equity investment service in California in April 2022 with $5.8 million in seed funding led by Gemini Ventures and Redwood Trust. In addition to its seed funding, the company said it had access to more than $1 billion in funding to make home equity investments at launch.

Six months later, Splitero expanded its equity investment service into Colorado and Washington, and in January announced an $11.7 million Series A funding round led by Fiat Ventures.

Splitero Inc. and its related companies — Splitero Funding Inc. and Splitero Homes Inc. — were incorporated in Delaware in 2021 and 2022, according to the Delaware Division of Corporations.

Gifford said Splitero Homes was incorporated “at the same time as our other entities since this was always part of the plan, but it has not been providing services until now.”

Splitero co-founder David Zvaifler is the designated agent for Splitero Funding and Splitero Homes, which were licensed in California in April 2022. According to the Nationwide Mortgage Licensing System and Registry, Splitero Funding is licensed in California, Colorado and Oregon, and sponsors six mortgage loan originators.

Gifford’s LinkedIn profile lists previous experience that includes a four-year stint as a HomeVestors of America franchisee, followed by nearly three years as vice president and general manager of property marketplace Sundae.

HomeVestors, the “We Buy Ugly Houses” home flipping company, was recently the subject of a ProPublica investigation that claimed it targeted struggling homeowners and called into question the marketing and negotiating tactics the company allegedly urged its franchisees to employ.

Sundae, which promises to help homesellers “skip the hassle” of working with a real estate agent by marketing their properties directly to investors, laid off 15 percent of its workforce last summer.

Gifford said he and other founding members of Splitero “have bought and sold thousands of houses, so we’ve got a good deal of experience in this space” as real estate investors, brokers and mortgage originators. “This is kind of in our blood.”

Because Splitero’s profits are based on the homeowners’ price appreciation, Gifford said the interests of Splitero Homes and the sellers it represents will be aligned.

“We feel it’s a natural transition from ‘Hey, we’ve made an investment in you and your home,’ to ‘You’re ready to sell? That’s great. Let us help.’ We want to just make sure that you not only get the highest price, but you’re taken care of properly when you’re ready to sell your house.”

On websites that collect customer feedback, Splitero gets mixed reviews, with those leaving negative feedback complaining that their applications took a long time to process or were denied.

Splitero has been accredited by the Better Business Bureau since August 2022, and has an “A” rating from the BBB. Only three customers have submitted reviews to the BBB, which rate the company 2.33 out of 5 stars, on average.

One client who left a five-star BBB review said that although the process was long, she was “very thankful” for the services Splitero provided after her life changed due an unexpected medical issue. Two other clients left one-star reviews. One said they didn’t believe their home equity was fairly appraised, and another said “it took so long to get funded that my home went into foreclosure.”

Splitero has received feedback from 11 past clients on the review site Trustpilot, with an average rating of 3.4 out of 5 stars. While Splitero’s latest reviews were positive — the company received four 5-star reviews at the end of June — others who left negative reviews earlier this year complained about the length of the process, or did not understand why their application was denied.

Get Inman’s Mortgage Brief Newsletter delivered right to your inbox. A weekly roundup of all the biggest news in the world of mortgages and closings delivered every Wednesday. Click here to subscribe.

Email Matt Carter

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